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Will A Car Accident Increase Your Insurance Rates?

It depends. Following a motor vehicle accident, your PIP or no-fault auto insurance coverage will cover your losses regardless of who caused the crash. However, you may be concerned that your auto insurance rates might go up when you file your insurance claim. While an accident may impact your insurance rates, how much it will affect your rates will depend on various factors.

Factors That May Increase Your Auto Insurance Rates After a Car Accident

Unfortunately, a car accident can potentially hike your insurance rates because it raises your level of risk to your auto insurance provider. Several factors, however, will come into play when determining the impact on your auto insurance rates, such as:

Fault for The Car Accident

While New York follows the no-fault auto insurance coverage rules, if you caused the car crash, your insurance provider may lean towards increasing your rates, particularly if the accident resulted in costly and serious losses. The reason for this is that your insurer will automatically raise your level of risk and increase your rates to compensate for this.

Take note that while accidents resulting in minor damage or injuries, comprehensive claims, and not-at-fault accidents may potentially increase your rates, the increase will be significantly smaller.

Your Driving Record

To determine your level of risk, your insurance provider will evaluate your driving record, including any previous traffic violations and claims. Doing so will help them decide whether to increase your rates or not renew your auto insurance policy after an accident. Having a clean driving history without violations, accidents, or claims can minimize the impact of a recent car accident on your insurance rates.

On the other hand, a record littered with claims, violations, and accidents will indicate a higher level of risk that can result in a significant increase. 

Accident Forgiveness Coverage

If you have accident forgiveness coverage, your insurance provider will not increase your rates, even if you caused the accident. Depending on the terms of your policy, it may apply to various types of accidents and come with strict eligibility requirements, including having a clean driving history for three or five years. It’s crucial to note, however, that this coverage may only apply to one accident. You may qualify again in the future if you satisfy the eligibility requirements.

When Your Auto Insurance Provider Cannot Raise Your Insurance Rates

Under the law, your auto insurance provider cannot impose a surcharge or increase your rates after a car accident if any of the following applies to your case:

  • You filed your claim under your comprehensive insurance plan.
  • The losses for the accident are not more than $2,000, and the accident did not result in physical injury or death.

On the other hand, your insurance provider can increase your rates if you’ve had two or more car accidents that resulted in property damage.

If you need help following a car accident or need more information about how a car accident can impact your auto insurance rates, the New York car accident attorneys at Steve Foley Law Firm can help. Contact us online or call 716-249-2222 to arrange your free case evaluation with our New York car accident attorney.